Published in:IMF Working Paper, Vol. , pp. 1-34, 2003
Extent:
1 Online-Ressource (34 p)
Language:
English
DOI:
10.2139/ssrn.880220
Identifier:
Origination:
Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments September 2003 erstellt
Description:
This paper examines the reasons why corruption and policy distortions tend to exhibit a high degree of persistence in certain regimes. We identify circumstances under which a firm seeks to evade regulations by (1) bribing of local inspectors and (2) lobbying high-level government politicians to resist legal reforms designed to improve judicial efficiency and eliminate corruption. The analysis predicts that in politically unstable regimes the institutions necessary to monitor and enforce compliance are weak. In such countries corruption is more pervasive and the compliance with regulations is low. The empirical results support the predictions of the model